The latest CGA RSM Hospitality Business Tracker revealed the flat start to 2024 indicated pressure on consumers’ spending after a bumper festive season that saw the tracker finish 8.8% ahead in December 2023.
Produced by CGA by NIQ in partnership with RSM UK, the tracker found pubs trading finished 1.5% ahead in terms of like-for-like sales growth while restaurants saw 0.9%.
Watching outgoings
After strong growth in December, bars suffered a 13.6% decline in January sales while the on-the-go segment was 1.1% behind.
CGA by NIQ director of hospitality operators and food EMEA Karl Chessell said: “After spending freely in the run up to Christmas, consumers were clearly watching their outgoings very carefully in January.
“It is a reminder that while people remain eager to eat and drink out when they can, rising costs continue to limit discretionary spending.
“With hospitality operators’ margins also still squeezed by inflation, the sector needs sustained Government support on taxes and other issues if it is to unleash its full potential to invest and create jobs.”
Favouring experiences
The tracker went on to show trading patterns were even across the country with groups’ sales within the M25 last month up 0.7% compared to last year whereas sales outside of the capital were flat (0.0%).
RSK UK leisure and hospitality partners Saxon Moseley said: “Given the impact of successive storms Henk, Isha and Jocelyn that left many Brits sheltering at home in January alongside acute competition for scarce discretionary spending, these results demonstrate the appetite of consumers who continue to favour experiences over ‘things’.
“With ongoing cost pressures having already accounted for some recent high profile restaurant closures, operators will be hoping the continued fall in inflation, the prospect of interest rate cuts in the spring and the Six Nations rugby will tempt consumers to venture out and support their local establishments.”
